I believe that the root of most of the issues I see today is a result of lazy, or uninformed lenders, and an unwillingness to be honest with borrowers if they don’t know the answers.

Lazy Lender – Mislead Borrowers

If you’re reading this, you’re one of over 10,000 readers that visit this site every month. Because we have so many folks stopping by, I get questions and comments every day.

Some days I find myself at a complete loss to understand why a lender or loan officer would purposely mislead, misinform, and even straight out lie to consumers.

It reminds me of those online dating horror stories that you hear about where one of the “daters” uses a fake picture and bio, which is discovered once a face to face meeting happens.

It simply doesn’t make sense to me that a lender would purposely mislead a consumer to believe that they qualify, or don’t qualify for a home loan, only to discover later that the original solution offered is unachievable or completely inaccurate.

The thing that bugs me most is that because I do spend hours and hours every week reading guidelines, I know immediately what the lie is, and why the lender is lying.

I call it a lie, but ultimately it’s a lack of education on the lender’s part. The lie happens when the lender does not admit that they do not know the

Here are a couple of stories from the past week:

True Stories

This past week, I encountered two different scenarios that pushed me to the edge of my patience.

True Story #1 – It’s Not Me, It’s Fannie Mae

The Lie – This first story comes from a homebuyer that is trying to purchase a condominium in the State of California. We work very closely with the buyer’s real estate agent so they were referred to us for a second opinion.

The lender that the borrower is talking to told them that recent changes Fannie Mae now requires that Condominiums cannot close inside of 40 days.

I categorize this type of lie as a sort of hybrid Bait & Switch strategy where the lender never intends to provide the original loan and strings out the homebuyer so long that the only way to not lose the home is to take the loan the lender intended to offer in the first place.

In this particular case, I don’t think the lender went into it with malicious intent, I think it’s actually worse than that. I would suggest that the lender is not educated or experienced with the loan program that the borrower is trying to use.

Instead of telling the homebuyer that they don’t have experience with this loan, they lead you on to get a commitment, then hit you with a ridiculous explanation at the last moment.

Protect Yourself Against Lazy or Lying Lenders

Qualifying for a home loan is much more complicated than it’s ever been. There is more paperwork, tighter guidelines, and more verification required to check and double check the information you’ve already provided.

Trust your gut – Seriously, if it sounds too good to be true, or if it seems like it’s just too easy, that should be a red flag.

Online Research – Do your research online while in the pre-approval process.

If the loan officer is the actual person writing about your topic of interest, there’s a strong possibility that the lender has thoroughly researched the topic before putting it out on the internet.

The beauty of the internet is that you can do research on your own without making your lender feel like you don’t trust them. Yes, it can be just as confusing trying to sort out what’s accurate and what’s not, but believe me when I say that the time and effort is worth it.

Reach out to Lenders out of State – Most lenders are following the same underwriting guidelines if you are trying to qualify for Fannie Mae, FHA, VA or USDA financing. The qualifying guidelines are the same regardless of what State you’re buying in.

If the lender is not trying to get you to do business with them, you’re far more likely to get answers that do not include a “sales pitch”.

Have Questions?

If you are concerned that your lender is not up to date, lazy or actually lying, feel free to ask your questions below. I am a direct mortgage lender that can only lend in California, and I answer all questions regardless of whether or not we can do business together.

Ask your questions below in the comments section, shoot me an email, or give us a call. If we don’t know the answer, we’ll look it up! Hope this helps?

As a 18 year veteran of the Mortgage and Real Estate industry, I am passionate about educating and empowering consumers. I have been writing about consumer protection issues, and making sense of complicated real estate and mortgage topics on this website since 2007

antipode77

Hi, we recently got pre-approved for a loan, and headed down the road of a USDA loan for a house we wanted to buy. Now the lender (all of a sudden) is saying we don’t qualify for the loan due to employment gaps and length of time at current employer. The problem is that they had this info on day one when we applied for pre-approval! Now we’ve spent money in this process based on the lender. Is there any way to recover our loses? This was not our error!

FindMyWayHome.com is owned and operated by Scott Schang, a NMLS Licensed mortgage loan officer in the State of California NMLS# 279893 as well as a California Real Estate Broker CalBRE#01329470. The views and opinions expressed on FindMyWayHome.com are those of the authors and do not reflect the views and opinions of any other organization or business. Find My Way Home is a Trademark of FMWH, LLC | 5640 B Telegraph Rd | St Louis MO 63129 Privacy Policy

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